Wednesday, July 18, 2012

Will valley cities ‘paddle together’ for air service?

Ketchum considers new LOT for minimum-revenue guarantees

Express Staff Writer

Valley voters might have the opportunity to consider a new local-option tax this November to support air service. Express file photo

With enough support from Ketchum, Sun Valley and Hailey voters in November, the nonprofit Fly Sun Valley Alliance hopes to secure direct flights from San Francisco and an additional 20,000 visitors per year, bringing in an additional $34 million per year to the valley's economy as early as 2013.

Following Idaho Attorney General Lawrence Wasden's recent opinion supporting the combined use of Ketchum, Sun Valley and Hailey local-option tax proceeds to subsidize air service to Sun Valley, Fly Sun Valley Alliance is urging voters to approve a 1 percent, five-year temporary increase in the local-option tax in November.

According to a report presented by the Fly Sun Valley Alliance to the Ketchum City Council on Monday, for two or more cities to legally collectively support minimum-revenue guarantees for air service providers with taxpayer dollars, the attorney general's opinion is that the funds must flow through a joint powers agreement.

By state law, the agreement's wording must be ready by the end of August for the tax-increase measure to make it onto the Ketchum, Sun Valley and Hailey ballots. But so far, a joint powers agreement is far from settled.

"I'm very skeptical we'll have the joint powers agreement ready in six weeks," Ketchum City Attorney Stephanie Bonney said.

Councilwoman Nina Jonas expressed concern that problems could result if a joint powers agreement were not done right.

Some Ketchum business owners said voters would naturally be against a tax hike unless there were proper public outreach to inform voters that most of this tax would be paid by tourists.

"Locals will only pay about 20 percent of the tax," Mayor Randy Hall said.

< But Ketchum citizen Mickey Garcia objected to the undemocratic nature of the tax.

"This LOT tax is different [from a general sales tax] because it is paid for by visitors," he said "The people who are being taxed don't get to vote no!"

Wally Huffman, Sun Valley Co. director of development, said Ketchum, Sun Valley and Hailey have very low local-option taxes compared to other resort towns.

Council members asked whether there was an alternative plan to increase air service to the valley should the local-option tax increase be turned down by voters.

"Plan A is increase the LOT," Huffman said. "Plan C is do nothing and fail. Plan B is let's use the existing tax base to accomplish the same thing. This is not a good choice. In fact, it's a great argument for Plan A. We're not going to have enough money without community support."

In response to the council's general concern as to the legality of the initiative and the possibility of alternate approaches, state Rep. Wendy Jaquet, D-Ketchum, said Idaho law is "very strict in this area."

"There aren't many other places to go here," she said. "It's kind of a do-or-die situation."

Ketchum businessman Jack Bariteau expressed concern that valley voters might not take advantage of the opportunity opened by Wasden.

"I think many people don't understand how much of our future is controlled by the state Legislature in Boise," Bariteau said. "Now that Wendy Jaquet has worked so hard to get Boise to allow this, we should make the most of this opportunity."

According to the Fly Sun Valley Alliance report, Sun Valley Co. has agreed to match any revenue collected by the proposed increase in the local-option tax. The report states that the increase in the tax would generate $2 million per year over five years. With Sun Valley Co.'s contribution, the joint powers agreement would become the custodian of $20 million over five years to put toward increasing tourism in the valley.

"This is truly a historic moment," Hall said at the end of Fly Sun Valley Alliance's presentation. "This moment is the confluence of many great ideas. There is discussion of landing regional jets, a 1 percent LOT increase, a direct flight from SFO. It feels like this is the right time to pull the trigger on this. Thanks to all of you for paddling in the same direction."

Brennan Rego:

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